The Sunk Cost Problem I watched someone spend 14 months on a pricing strategy that never worked. Every month, they told themselves the same thing: next month will be different. It wasn't. By the time they finally changed course, they had lost roughly £47,000 in revenue they could have captured with a simpler approach. This happens constantly. People confuse persistence with stubbornness. They treat abandoning a strategy as failure, when sometimes it is the smartest move available. The hard part is knowing which is which. Why People Stay Too Long Three things keep people locked into failing strategies. First, identity. If you spent weeks building a new sales process or months developing a product feature, walking away feels like admitting you were wrong. Nobody enjoys that. So you keep going, hoping the market will eventually agree with you. Second, visibility. You have already told people about this. Your team knows. Maybe you posted about it. Reversing course feels embarrassing. So you stay quiet and keep pushing. Third, false signals. Occasionally something good happens. One customer loves it. One week looks promising. You mistake noise for signal and convince yourself the corner is about to be turned. I have done all three. More than once. The John Lewis Question Peter Ruis just left John Lewis after what analysts called "doing a good job in difficult circumstances." That phrase stuck with me. Sometimes the circumstances are simply wrong. The strategy might be fine. The execution might be fine. But the environment has shifted. This is worth thinking about for anyone running their own thing. When a strategy fails, the question is not always "what did I do wrong?" Sometimes the question is "what changed that I cannot control?" The EV market is a good example right now. The government is considering cutting electric car sales targets from 80% to 50% by 2030. Battery gigafactories are shelving expansion plans. If your strategy depended on EV adoption accelerating at the pace predicted two years ago, you are not failing. The ground moved. Recognising that distinction matters. It changes what you do next. Three Signs It Is Time to Exit After working with people building businesses across London and beyond, I have noticed patterns. These are the signals that usually mean a strategy needs to end, not just adjust. The core assumption was wrong. Every strategy rests on a belief about how customers behave, what they value, or what they will pay. If that belief turns out to be false, no amount of tweaking fixes it. You need a different strategy, not a better version of this one. The cost of continuing exceeds the cost of switching. This sounds obvious, but people rarely calculate it properly. They count what they have already spent, which is irrelevant. The only question is: from today forward, what does staying cost versus what does changing cost? When I run this through with clients using the Decision Matrix at alira.london, the answer often surprises them. You are managing decline, not building momentum. There is a difference between a strategy that needs more time and one that is slowly dying. If every month requires more effort to get the same result, that is decline. Time will not fix it. How to Exit Cleanly Once you decide to stop, do it properly. Half-exits waste more resources than full commitment either way. Set a hard deadline. Not "we'll wind this down over the next few months" but "this ends on the 15th." Vague timelines let things drag on. Capture what you learned. Every failed strategy teaches you something about your customers, your market, or yourself. Write it down before you move on. I use the 5 Whys tool at alira.london for this. Five rounds of asking "why did this fail?" usually gets to something useful. Communicate directly. If your team or customers were involved, tell them what is changing and why. People respect honesty more than they respect false optimism. Redeploy the resources immediately. The energy, money, and attention you free up need to go somewhere. If you do not direct them deliberately, they dissipate. The Harder Question Sometimes the strategy is not the problem. The business model is. I have seen people exit strategy after strategy, always looking for the right tactic, when the real issue is structural. Their margins are too thin. Their market is too small. Their offer solves a problem nobody is willing to pay to fix. If you have exited three strategies in two years and nothing has worked, stop looking at strategies. Look at the model underneath them. That is a harder conversation, but avoiding it costs more. What to Do This Week Run the numbers on one strategy you are unsure about. Not what you have already spent. What continuing costs versus what switching costs, from today forward. Be honest. Write it down. Identify the core assumption. What would have to be true for this strategy to work? Is that thing still true? If you are not sure, find out this week. Set a decision date. If you are on the fence about something, pick a date within the next 30 days when you will decide. Put it in your calendar. When that date arrives, decide. No more waiting for more information.